Teaching Hospitals Cost More, but Could Save Your Life

Perhaps not evident to many patients, there are two kinds of hospitals — teaching and nonteaching — and a raging debate about which is better. Teaching hospitals, affiliated with medical schools, are the training grounds for the next generation of physicians. They cost more. The debate is over whether their increased cost is accompanied by better patient outcomes.

Teaching hospitals cost taxpayers more in part because Medicare pays them more, to compensate them for their educational mission. They also tend to command higher prices in the commercial market because the medical-school affiliation enhances their brand. Their higher prices could even cost patients more, if they are paying out of pocket.

To save money, insurers have started establishing hospital networks, and policy makers are considering ways to steer patients away from teaching hospitals. Those efforts may well save patients and taxpayers money. But how will that affect the quality of care?

One answer is provided in a new study of over 21 million hospital visits paid for by Medicare in 2012 and 2013. Teaching hospitals save lives. For every 83 elderly patients seen by a major teaching hospital, one more is alive 30 days after discharge than if those patients had been admitted to a nonteaching hospital. This is a large mortality effect.

“It’s about half the size of a breakthrough medical therapy like stenting for heart-attack patients,” said Amitabh Chandra, an economist with the Harvard Kennedy School and a longtime skeptic of the value of teaching hospitals, who wasn’t involved in this study.

The study, published in the Journal of the American Medical Association, adjusted for other factors that could have skewed the results, like demographics, patients’ diagnoses, hospital size and profit status. Because mortality rates differ geographically, it compared teaching with nonteaching hospitals within the same state. Even after such adjustments, it found mortality rates are lower at teaching hospitals for 11 of 15 common medical conditions and five of six major surgical conditions. The more doctors in training per bed a hospital had, the lower its mortality rate.

“We thought the comparative performance of teaching and nonteaching hospitals was worth a fresh look because medicine has changed considerably since those older studies,” said Laura Burke, the lead author on the study and an emergency physician with the Harvard T.H. Chan School of Public Health. “And the more recent studies don’t settle the question.” (I am a co-author on the study, along with Dr. Burke and other Harvard colleagues Dhruv Khullar, E. John Orav and Ashish Jha. Dr. Khullar is also an Upshot contributor.) The study was funded by the Association of American Medical Colleges, which had no editorial control over analysis or publication.

Though the study revealed mortality differences by teaching status, it could not illuminate the cause of those differences. Perhaps teaching hospitals attract higher-quality practitioners, more closely follow best practices, or use medical technology more effectively.

Other studies suggest teaching hospitals do not offer higher quality more broadly. For example, an analysis led by Jose Figueroa, a physician with the Harvard T.H. Chan School of Public Health, found that teaching hospitals were more likely to be penalized by Medicare for low quality compared with nonteaching hospitals. Another study found teaching hospitals were more likely to be penalized for higher hospital readmission rates.

The new study did not assess the cost of the benefits in mortality that teaching hospitals deliver.

“The typical teaching hospital is at least 30 percent more expensive,” Mr. Chandra said. “Is 1 percent fewer deaths worth that price?” It’s a question few like to ask, but spending more on hospital care means less for other things we value — and that are known to improve health and welfare, too — like education and nutrition programs.

About 26 percent of hospitals are teaching hospitals, accounting for just over half of all admissions. Unsure which hospitals in your area are teaching hospitals? It’s something most of them make a point of mentioning, so you can often find a hospital’s teaching status on its website. If not, an inquiry to the hospital should settle the matter. If you use one, the cost of your care will be higher, but it might save your life.

Correction:

An earlier version of this article misstated the name of an organization that funded the study comparing teaching and nonteaching hospitals. It’s the Association of American Medical Colleges, not the American Association of Medical Colleges.